Where Anyone Can Be an Entrepreneur, With None of the Risk

Leigh Buchanan is an editor-at-large for Inc. magazine. A former editor at Harvard Business Review and founding editor of Webmaster Magazine, she writes regular columns on leadership and workplace culture.

Plenty of companies reward employees who suggest ideas for new businesses. A little gratitude. Maybe a bonus. Perhaps a role on a new team. At digital consultancy DEG, CEO Neal Sharma goes further: You suggest it, you build it from the ground up.

DEG's embrace of intrapreneurship began in 2007 when Cara Olson, a web strategist. returned from maternity leave eager to try something different. Back then, DEG was a small Web-development shop: Olson recommended expanding into email marketing. "I told them I wanted to own it, like it's my own business," she recalls. Go for it, Sharma encouraged her.

Olson put together a business plan and started hunting local clients, then bigger, regional game. "I was wearing every hat--doing sales, servicing the client, doing the invoicing and the admin," says Olson. After 18 months, she brought on an employee, and her staff has nearly doubled every year since. Today, with about $10 million in sales, email marketing comprises close to half of DEG's revenues and feeds clients to other divisions.

Other employees followed suit. Three of the company's seven business units were erected from the ground up by the employees who suggested them. Staff in some of those units have begun nurturing their own new business ideas as well. Not every new venture has been successful. But a developer conceived and built DEG's social media business, which now serves such clients as Lee Jeans and Hyatt Hotels. That intrapreneur, in turn, hired the employee who pioneered DEG's creative services.

Each venture starts small, so the financial risk is manageable. The larger cost, says Sharma, is dilution of focus. "When the sales team and the marketing team have to go out and talk about these other things, and the executive team has to think about these other things, then the opportunity costs can be fairly significant," he says.

Meanwhile, the non-entrepreneurially inclined benefit from DEG's unusual degree of mobility. "We embrace the idea of a corporate lattice, where people have the opportunity to move up, laterally, and sometimes into these new areas," says Sharma. Half of employees who have worked at DEG a year or more hold different positions from when they started. The company bestows new positions on existing employees, so long as those employees demonstrate they can be up to the job in three months' time. Sharma says such opportunities contribute to a retention rate north of 90 percent.

(Other benefits reinforce that loyalty. Most notably, on their fifth anniversaries, employees receive two plane tickets to any destination in the United States. On their tenth anniversaries, it's to anywhere in the world. "We're looking for people to live lives chockablock with interesting experiences," says Sharma. "Travel, in our view, is one of the best ways to be interesting.")

Underpinning DEG's culture is a trio of metaphors that Sharma calls his "Three Reasons Why Everyone Should Be an Entrepreneur." First, there is the car. "Never tell me it is riskier to drive a car than to sit in the back seat," says Sharma. "If you are driving, you get to determine how fast to go, how wide to make that turn." Second: the party. "If you invite me to a party from 7 p.m. to midnight and your colleague invites me to a party from 7 p.m. to question mark, I'm going to attend your colleague's event," says Sharma. "Because I'm not limited by anything but my ability to party. You should never be limited by anything but your potential."

Sharma's final metaphor is the cathedral. "Everyone spends their days laying bricks," he says. "If you are going to do that, then why not build something that embodies your own hopes, dreams, values, and convictions?"